<PAGE>

                                 United States
                      Securities and Exchange Commission
                             Washington, DC  20549

                                   Form 10-Q

               THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN
            GENERAL INSTRUCTIONS H(1) (a) AND (b) OF FORM 10-Q AND
       IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934
    For the quarterly period ended  September 30, 2000
                                   --------------------

                                    OR

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934
    For the transition period from __________________ to _______________


Commission File   Registrant; State of Incorporation;    IRS Employer
    Number        Address; and Telephone No.             Identification No.
    ------        --------------------------             ------------------


   333-75369      PPL Transition Bond Company, LLC            23-3004428
                  (Delaware)
                  Two North Ninth Street, GENA92, Room 3
                  Allentown, PA 18101-1179
                  (610) 774-7934

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES [ X ] NO [_]
<PAGE>

                       PPL TRANSITION BOND COMPANY, LLC
                       --------------------------------

                                   FORM 10-Q
                   FOR THE QUARTER ENDED SEPTEMBER 30, 2000

                                     INDEX
                                     -----
<TABLE>
<CAPTION>
PART I.  FINANCIAL INFORMATION                                      Page
<S>                                                                <C>
   Item 1. Financial Statements

          Statement of Operations and Changes in Member's Equity      1

          Statement of Cash Flows                                     2

          Balance Sheet                                               3


          Notes to Financial Statements                               4

   Item 2. Management's Discussion and Analysis of
          Financial Condition and Results of Operations               8

   Item 3. Quantitative and Qualitative Disclosures
          About Market Risk                                           9

PART II. OTHER INFORMATION

   Item 1. Legal Proceedings                                         10

   Item 6. Exhibits and Reports on Form 8-K                          10

GLOSSARY OF TERMS AND ABBREVIATIONS                                  11

SIGNATURES                                                           13
</TABLE>
<PAGE>

PPL TRANSITION BOND COMPANY, LLC
--------------------------------
Part 1. FINANCIAL INFORMATION
--------------------------------
Item 1. Financial Statements
--------------------------------

STATEMENT OF OPERATIONS AND CHANGES IN MEMBER'S EQUITY
(Unaudited)
(Thousands of Dollars)


<TABLE>
<CAPTION>
                                                              Three Months                           Nine Months
                                                           Ended September 30,                   Ended September 30,
                                                       ---------------------------           --------------------------
                                                           2000           1999                  2000          1999 (a)
                                                        ---------      ---------              --------       ----------
Revenue
<S>                                                     <C>          <C>                   <C>             <C>
    Intangible transition charge revenue.................  $95,363       $64,164              $301,424        $64,164
    Interest income......................................       55           100                   136            100
                                                           -------       -------              --------        -------
                      Total revenue......................   95,418        64,264               301,560         64,264
                                                           -------       -------              --------        -------

Expenses
    Amortization of intangible transition property.......   55,343        40,800               178,585         40,800
    Interest expense.....................................   39,503        23,722               121,405         23,722
    Administrative and general expenses..................      518           299                 1,434            299
                                                           -------       -------              --------        -------
                      Total expenses.....................   95,364        64,821               301,424         64,821
                                                           -------       -------              --------        -------
Operating Income (Loss)..................................       54          (557)                  136           (557)

Income tax expense (benefit).............................       22          (231)                   56           (231)
                                                           -------       -------              --------        -------
Net Income (Loss)........................................  $    32       $  (326)             $     80        $  (326)
                                                           =======       =======              ========        =======
Member's equity - beginning of period....................   12,353             1                12,305              0

Member's cash contribution...............................                 12,100                               12,101
                                                           -------       -------              --------        -------
Member's equity - end of period..........................  $12,385       $11,775              $ 12,385        $11,775
                                                           =======       =======              ========        =======
</TABLE>

(a)  For the Period March 25, 1999 (date of inception) to September 30, 1999.

The accompanying Notes to Financial Statements are an integral part of the
financial statements.

                                       1
<PAGE>

PPL TRANSITION BOND COMPANY, LLC
--------------------------------
STATEMENT OF CASH FLOWS
(Unaudited)
(Thousands of Dollars)

<TABLE>
<CAPTION>
                                                                                                               For the Period
                                                                                             For the         March 25, 1999 (date
                                                                                        Nine Months Ended      of inception) to
                                                                                        September 30, 2000   September 30, 1999
                                                                                       -------------------   -------------------
Cash Flows From Operating Activities
<S>                                                                                   <C>                       <C>
  Net Income (Loss)................................................................         $        80             $      (326)

  Adjustments to reconcile net income to net cash
   provided by operating activities:
     Amortization of intangible transition property................................             178,585                  40,800
     Amortization of debt issuance expenses........................................               2,521                     454
     Amortization of debt discount.................................................                  51                      11
     Deferred income taxes.........................................................                                        (318)
     Changes in current assets and liabilities:
         Intangible transition charges receivable
            from Servicer..........................................................              (5,250)                (55,734)
         Payable to Servicer.......................................................              (1,056)                  1,293
         Other.....................................................................               1,766                  23,664
  Other operating activities - net.................................................                 981                     120
                                                                                        ---------------         ---------------
         Net cash provided by operating activities.................................             177,678                   9,964
                                                                                        ---------------         ---------------

Cash Flows From Investing Activities
  Purchase of intangible transition property.......................................                                  (2,402,000)
  Increase in restricted funds.....................................................              (5,632)                (12,200)
                                                                                        ---------------         ---------------
         Net cash used in investing activities.....................................              (5,632)             (2,414,200)
                                                                                        ---------------         ---------------

Cash Flows From Financing Activities
   Proceeds from issuance of transition bonds......................................                                   2,419,737
   Retirement of transition bonds..................................................            (174,624)
   Debt issuance expenses..........................................................                                     (14,281)
   Equity contribution from member.................................................                                      12,101
                                                                                        ---------------         ---------------
          Net cash provided by (used in) financing activities......................            (174,624)              2,417,557
                                                                                        ---------------         ---------------

Net Increase (Decrease) in Cash and Cash Equivalents...............................              (2,578)                 13,321
Cash and Cash Equivalents at Beginning of Period...................................               2,830                       0
                                                                                        ---------------         ---------------
Cash and Cash Equivalents at End of Period.........................................          $      252             $    13,321
                                                                                        ===============         ===============

Supplemental Disclosure of Cash Flow Information
  Cash paid during the period for:
   Interest........................................................................         $  118,985             $         0
   Income taxes....................................................................         $        0             $         0
 </TABLE>

The accompanying Notes to Financial Statements are an integral part of the
financial statements.

                                       2
<PAGE>

PPL TRANSITION BOND COMPANY, LLC
--------------------------------
BALANCE SHEET
(Unaudited)

<TABLE>
<CAPTION>
(Thousands of Dollars)                                        September 30,    December 31,
                                                                   2000            1999
                                                              -------------    ------------
<S>                                                          <C>              <C>
ASSETS
 Current Assets
    Cash and cash equivalents...............................  $         252    $      2,830
    Intangible transition charges receivable from Servicer..         73,757          68,507
    Accounts receivable from member - income taxes..........          6,162           6,105
    Prepaid expenses and other receivables..................             58              55
                                                              -------------    ------------
       Current assets.......................................         80,229          77,497
                                                              -------------    ------------

 Noncurrent Assets
    Intangible transition property, net.....................      2,138,395       2,316,980
    Unamortized debt issuance expenses......................         12,344          14,865
    Restricted funds........................................          9,151           3,519
                                                              -------------    ------------
       Noncurrent assets....................................      2,159,890       2,335,364
                                                              -------------    ------------

       Total assets.........................................  $   2,240,119    $  2,412,861
                                                              =============    ============

LIABILITIES AND MEMBER'S EQUITY
 Current Liabilities
    Long-term debt..........................................  $     236,859    $    226,699
    Interest accrued........................................          2,107           2,255
    Payable to Servicer.....................................                          1,056
    Other...................................................          2,561             587
                                                              -------------    ------------
       Current liabilities..................................        241,527         230,597
                                                              -------------    ------------

 Noncurrent Liabilities
    Long-term debt, net of discount.........................      1,978,649       2,163,382
    Deferred income taxes...................................          6,250           6,250
    Other...................................................          1,308             327
                                                              -------------    ------------
       Noncurrent liabilities...............................      1,986,207       2,169,959
                                                              -------------    ------------

 Commitments And Contingent Liabilities.....................
                                                              -------------    ------------

 Member's Equity............................................         12,385          12,305
                                                              -------------    ------------

       Total liabilities and member's equity................  $   2,240,119    $  2,412,861
                                                              =============    ============
</TABLE>

  The accompanying Notes to Financial Statements are an integral part of the
                             financial statements.

                                       3
<PAGE>

                       PPL Transition Bond Company, LLC
                         Notes to Financial Statements
                       ---------------------------------

   Terms and abbreviations appearing in Notes to Financial Statements are
explained in the glossary.

1. Interim Financial Statements

   Certain information in footnote disclosures, normally included in financial
statements prepared in accordance with generally accepted accounting principles,
has been condensed or omitted in this Form 10-Q pursuant to the rules and
regulations of the SEC. These financial statements should be read in conjunction
with the financial statements and notes included in PPL Transition Bond Company,
LLC's Annual Report to the SEC on Form 10-K for the year ended December 31,
1999. Certain amounts in the September 30, 1999 and December 31, 1999 financial
statements have been reclassified to conform to the presentation in the
September 30, 2000 financial statements.

2. Nature of Operations

   The financial statements include the accounts of PPL Transition Bond Company,
LLC (the Company). The Company is a limited liability company established under
the laws of the State of Delaware, and was formed on March 25, 1999 pursuant to
a limited liability company agreement. PPL Electric Utilities is the sole member
of the Company.

   The Company was organized for the sole purpose of purchasing and owning ITP,
issuing transition bonds (the Bonds), pledging its interest in ITP and other
collateral to the Trustee under an Indenture between the Company and the Trustee
to collateralize the Bonds, and performing activities that are necessary to
accomplish these purposes. ITP represents the irrevocable right of PPL Electric
Utilities, or its successor or assignee, to collect a non-bypassable ITC from
customers pursuant to the PUC Restructuring Order in accordance with the
Competition Act. The PUC Restructuring Order authorized the ITC to be sufficient
to recover up to $2.85 billion aggregate principal amount of Bonds, plus an
amount sufficient to provide for any credit enhancement, to fund any reserves
and to pay interest, redemption premiums, servicing fees and other expenses
relating to the Bonds.

   The Company's organizational documents require it to operate in a manner so
that its assets would not be consolidated with the bankruptcy estate of PPL
Electric Utilities in the event PPL Electric Utilities becomes subject to a
bankruptcy proceeding. Both PPL Electric Utilities and the Company have treated
the transfer of the ITP to the Company as a sale under applicable law. The Bonds
are treated as debt obligations of the Company. The assets of the Company are
not available to creditors of PPL Electric Utilities or PPL Corporation, and the
ITP is legally not an asset of PPL Electric Utilities or PPL Corporation. The
Company is expected to terminate its existence after final maturity of the
Bonds.

   The Company issued $2.42 billion of Bonds in eight different classes on
August 10, 1999. See Note 4 for additional information.

                                       4
<PAGE>

3. Summary of Significant Accounting Policies

Management's Estimates

   The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions.
These estimates and assumptions will affect the reported amount of revenues,
expenses, assets, and liabilities and disclosure of contingencies. Actual
results could differ from these estimates.

Cash and Cash Equivalents

   The Company considers all liquid debt instruments purchased with a maturity
of three months or less to be cash equivalents. Cash and Cash Equivalents do not
include Restricted Funds.

Restricted Funds

   Under the Indenture, the Company deposited an amount equal to 0.5% of the
initial principal amount of the 1999-1 Bonds into the Capital Subaccount with
the Trustee. This amount was contributed by PPL Electric Utilities to the
Company. This account is the last account drawn in the event funds are
insufficient to make scheduled allocations. If the Capital Subaccount is used,
it will be replenished from ITC remittances to its original level through the
periodic reconciliation process. Accordingly, the Capital Subaccount is
classified as "Restricted Funds" on the Balance Sheet.

Amortization of Intangible Transition Property

   The ITP was recorded at the acquired cost and is being amortized over the
life of the Bonds, based on ITC revenues, interest accruals and other fees. The
ITP is solely the property of the Company.

Amortization of Debt Issuance Costs and Discount on Debt

   The costs associated with the issuance of the Bonds have been capitalized and
are being amortized over the life of the Bonds, utilizing the effective interest
method.

Income Taxes

   The Company is a limited liability company and has elected to be disregarded
as a separate entity for federal and state income tax purposes. The Company's
taxable income or loss is included in the consolidated federal and state income
tax returns of its member. The Statement of Operations and Changes in Member's
Equity reflects the Company's pro rata allocation of its member's consolidated
income taxes in accordance with its member's tax sharing policy.

4. Long-Term Debt and Source of Repayment

   In August 1999, the Company issued $2.42 billion of Series 1999-1 Bonds. The
Bonds consist of eight classes. The Company used the proceeds

                                       5
<PAGE>

from the Bonds to purchase ITP from CEP Securities. The Bonds are collateralized
by the ITP and other assets of the Company.

Scheduled maturities and interest rates for the Bonds at September 30, 2000 are:

                                       Expected Final     Final
Class      Bond Rate      Amount       Payment Date       Maturity Date
-----      ---------      ------       ----------------   -----------------
                       ($ Thousands)
A-1          6.08%      $   88,690     March 25, 2001     March 25, 2003
A-2          6.41%         178,000     December 26, 2001  December 26, 2003
A-3          6.60%         303,000     March 25, 2003     March 25, 2005
A-4          6.72%         201,000     December 26, 2003  December 26, 2005
A-5          6.83%         313,000     March 25, 2005     March 25, 2007
A-6          6.96%         223,000     December 26, 2005  December 26, 2007
A-7          7.05%         455,000     June 25, 2007      June 25, 2009
A-8          7.15%         454,000     December 26, 2008  June 25, 2009
                        ----------
                        $2,215,690
Current Maturities        (236,859)
Unamort. Discount             (182)
                        ----------

Long-term Debt          $1,978,649
                        ==========

   The carrying value of the long-term debt approximates fair market value as of
September 30, 2000. The current maturities stated above are based on the
expected final payment dates rather than the final maturity date.

   The source of repayment for the Bonds is the ITC. The Servicer collects this
non-bypassable charge from PPL Electric Utilities' retail consumers of
electricity. The Servicer deposits ITC monthly collections into a General
Subaccount maintained by the Trustee under the Indenture. The monthly ITC
collections from December 1999 through August 2000 were $297 million in
aggregate. Each quarter, such monies are used to make principal and interest
payments on the Bonds, and to pay fees, costs and charges specified in the
Indenture. The Trustee made scheduled payments on March 27, June 26 and
September 25, 2000. The Indenture also includes a Reserve Subaccount that is
maintained for the purpose of retaining any excess amount of ITC collections and
investment earnings not released to the Company. The Indenture also provides for
an Overcollateralization Subaccount. The funding level of this account is 0.5%
of the initial principal amount of the Series 1999-1 Bonds, funded ratably over
the life of the Bonds. An amount equal to 0.5% of the initial principal amount
of the Bonds was deposited into the Capital Subaccount under the Indenture on
the date of issuance. If amounts available in the General, Reserve, and
Overcollateralization Subaccounts are not sufficient on any payment date to make
scheduled payments, the Trustee will draw on amounts in the Capital Subaccount
in excess of $100,000. The Trustee was required to withdraw $8.6 million from
the Capital Subaccount on December 27, 1999 and $3.4 million from the Capital
Subaccount on March 27, 2000 to help make principal payments of $29.7 and $60.9
million, respectively. On June 26, 2000, the Trustee replenished the Capital
Subaccount in the amount of $2.8 million, and on September 25, 2000, the Trustee
replenished the Capital Subaccount in the amount of $6.3 million. Additionally,
the Company's scheduled Overcollateralization Subaccount level as of September
30, 2000, was $1.3 million. As of September 30, 2000, no allocations of any
required amounts to the Overcollateralization Subaccount have been made. The
Overcollateralization Subaccount level will be replenished to equal the

                                       6
<PAGE>

scheduled overcollateralization level after all shortfalls in the Capital
Subaccount have been replenished. Any remaining amounts collateralizing the
Bonds will be released to the Company upon final payment on the Bonds.

   At September 30, 2000, the following balances were reflected in the
Subaccounts maintained by the Trustee:

          Subaccounts                 Balance
          -----------                 -------
                                   ($ Thousands)
          General                        $    0
          Reserve                             0
          Overcollateralization               0
          Capital                        $9,151

5. Significant Agreements and Related Party Transactions

   Under the Servicing Agreement, PPL Electric Utilities, as Servicer, is
required to manage and administer the ITP of the Company and to collect the ITC
on behalf of the Company. The Company pays an annual servicing fee of $1.25
million to PPL Electric Utilities. For the three months ended September 30,
2000, the Company expensed servicing fees of approximately $313,000 and other
administrative fees of $25,000. For the nine months ended September 30, 2000,
the Company expensed servicing fees of approximately $939,000 and other
administrative fees of $75,000.

   Debt issuance costs of approximately $16.3 million were incurred in
connection with the issuance of the Bonds. Of that amount, about $4.9 million
has been incurred by PPL Electric Utilities and has been reimbursed by the
Company.

   At September 30, 2000, the Balance Sheet includes a receivable from PPL
Electric Utilities of approximately $74 million for ITC collections.

                                       7
<PAGE>

                       PPL Transition Bond Company, LLC
                       --------------------------------

Item 2. Management's Discussion and Analysis of
        Financial Condition and Results of Operations
        ---------------------------------------------

Forward-Looking Information

   Certain statements contained in this Form 10-Q concerning expectations,
beliefs, plans, objectives, goals, strategies, future events or performance and
underlying assumptions and other statements which are other than statements of
historical facts are "forward-looking statements" within the meaning of the
federal securities laws. Although PPL Electric Utilities and the Company believe
that the expectations and assumptions reflected in these statements are
reasonable, there can be no assurance that these expectations will prove to have
been correct. These forward-looking statements involve a number of risks and
uncertainties, and actual results may differ materially from the results
discussed in the forward-looking statements. Any such forward-looking statements
should be considered in conjunction with PPL Electric Utilities' and the
Company's other documents on file with the SEC.

   New factors that could cause actual results to differ materially from those
described in forward-looking statements emerge from time to time, and it is not
possible for PPL Electric Utilities or the Company to predict all of such
factors, or the extent to which any such factor or combination of factors may
cause actual results to differ from those contained in any forward-looking
statement. Any forward-looking statement speaks only as of the date on which
such statement is made, and neither PPL Electric Utilities nor the Company
undertakes any obligation to update the information contained in such statement
to reflect subsequent developments or information.

Results of Operations

   The following analysis of the financial condition and results of operations
of the Company is in an abbreviated format pursuant to Instruction H of Form 10-
Q. Such analysis should be read in conjunction with the Financial Statements and
Notes to Financial Statements included in Item 1 above, and with the section
entitled "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in the Company's Annual Report to the SEC on Form 10-K
for the year ended December 31, 1999.

   PPL Transition Bond Company, LLC (the Company) is a Delaware limited
liability company organized in March 1999 for the limited purposes of purchasing
ITP and issuing Bonds secured by the ITP. The Company is wholly-owned by PPL
Electric Utilities. The Company's organizational documents require it to operate
in a manner so that its assets would not be consolidated with the bankruptcy
estate of PPL Electric Utilities in the event PPL Electric Utilities becomes
subject to a bankruptcy proceeding.

   During the nine months ended September 30, 2000, the revenue generated from
the ITP was approximately $301 million. The Company also earned approximately
$136,000 in interest from the Capital Subaccount maintained by the Trustee and
from temporary investments. Interest expense of approximately $121 million
consists of interest on the Bonds, amortization of debt issuance expenses and
the discount on the Bonds. For the nine

                                       8
<PAGE>

months ended September 30, 2000, the Company also incurred administrative and
general expenses of approximately $1.4 million, including servicing fees of
approximately $939,000 and other administrative fees of $75,000.

   The principal amount of the Bonds, interest, fees, and funding of the
Overcollateralization Subaccount will be recovered through ITC payable by retail
consumers of electricity within PPL Electric Utilities' service territory who
receive electric delivery service from PPL Electric Utilities. As part of PPL
Electric Utilities' responsibility as Servicer under the Servicing Agreement,
PPL Electric Utilities remitted to the Trustee approximately $297 million of ITC
collections for the period December 1, 1999 to August 31, 2000.

   Quarterly payments of Bond principal, interest and all related expenses were
made by the Trustee on March 27, June 26, and September 25, 2000. Due to the
manner in which seasonal customer electricity usage levels were estimated for
purpose of establishing the initial ITC, the Trustee was required to use $4.9
million of the funds in the Capital Subaccount on March 27, 2000 (including
approximately $1.5 million of excess Bond proceeds transferred to the Capital
Subaccount). There was sufficient revenue to make interest payments due on the
quarterly payment date, March 27, 2000. After application of the remaining $4.9
million in the Capital Subaccount and unapplied Bond proceeds, the Company had a
shortfall of $1.2 million in the scheduled principal payment on that date (which
shortfall did not constitute an Event of Default under the Indenture). On June
26, 2000, there was sufficient revenue to make the scheduled quarterly principal
and interest payments, to pay the $1.2 million shortfall in the scheduled
principal payment for March 2000, and to replenish the Capital Subaccount in the
amount of $2.8 million. On September 25, 2000, there was sufficient revenue to
make the scheduled quarterly principal and interest payments, and to replenish
the Capital Subaccount by an additional $6.3 million.

   The Company currently anticipates that there will be sufficient revenue to
make interest and principal payments due on the next quarterly payment date of
December 26, 2000, and to replenish the shortfalls in the Capital and
Overcollateralization Subaccounts.

   Under the annual reconciliation process established by the Competition Act
and the PUC Restructuring Order, withdrawals from the Capital Subaccount must be
replenished, and shortfalls in the scheduled Overcollateralization level and
scheduled principal payments must be made up, by increases in the ITC. Under the
Servicing Agreement, PPL Electric Utilities, as Servicer, filed a request for an
adjustment to the ITC with the PUC on December 15, 1999 to produce additional
revenues sufficient to replenish the Capital Subaccount and to make up
shortfalls in the scheduled Overcollateralization level and scheduled principal
payments by the December 2000 quarterly payment date. This adjustment went into
effect on January 1, 2000.

Item 3. Quantitative and Qualitative Disclosures About Market Risk
        ----------------------------------------------------------

Not applicable.

                                       9
<PAGE>

                       PPL TRANSITION BOND COMPANY, LLC
                       --------------------------------

PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings
--------------------------

None.

Item 6.  Exhibits and Reports on Form 8-K
-----------------------------------------

     (a)  Exhibits

             27 - Financial Data Schedule

             99 - Quarterly Servicer's Certificate

     (b)  Reports on Form 8-K

          None.

                                       10
<PAGE>

GLOSSARY OF TERMS AND ABBREVIATIONS

Capital Subaccount - An account held by the Trustee under the Indenture which is
funded by a contribution to PPL Transition Bond Company, LLC by PPL Electric
Utilities at the date of issuance of each series of transition bonds.

CEP Securities - CEP Securities Co. LLC, a Delaware limited liability company
and an indirect wholly-owned subsidiary of PPL Electric Utilities. Effective
July 1, 2000 CEP Securities is a subsidiary of PPL Energy Funding Corp.

Competition Act - The Pennsylvania Electricity Generation Customer Choice and
Competition Act, enacted in Pennsylvania in December 1996.

General Subaccount - An account held by the Trustee under the Indenture, into
which ITC remittances by the Servicer are deposited. The Trustee allocates the
funds from the General Subaccount to other subaccounts on the quarterly payment
dates.

Indenture - The Indenture entered into by PPL Transition Bond Company, LLC and
the Trustee, providing for the issuance of transition bonds.

ITC - Intangible Transition Charge, which PPL Electric Utilities has been
authorized by the PUC to impose on customer bills and to collect through a non-
bypassable billing mechanism to recover Qualified Transition Expenses.

ITP - Intangible Transition Property, which is the property right created under
the Competition Act representing the irrevocable right of PPL Transition Bond
Company, LLC to receive, through ITC, amounts sufficient to recover all
Qualified Transition Expenses.

Overcollateralization Subaccount - An account held by the Trustee under the
Indenture, which is funded ratably from collections of ITC over the term of each
series of transition bonds.

PPL Electric Utilities - PPL Electric Utilities Corporation, the sole member of
PPL Transition Bond Company, LLC.

PUC - The Pennsylvania Public Utility Commission.

PUC Restructuring Order - The final order issued by the PUC to PPL Electric
Utilities in August 1998, in connection with PPL Electric Utilities'
restructuring filing under the Competition Act, as supplemented by the May 1999
PUC order.

Qualified Transition Expenses - The transition or stranded costs of an electric
utility approved by the PUC for recovery through the issuance of transition
bonds; the costs of retiring existing debt or equity capital of the electric
utility or its holding company parent, including accrued interest and
acquisition or redemption premium, costs of defeasance, and other related fees,
costs and charges, through the issuance of transition bonds or the assignment,
sale or other transfer of ITP; and the costs incurred to issue, service or
refinance the transition bonds, including

                                       11
<PAGE>

accrued interest and acquisition or redemption premium, and other related fees,
costs and charges associated with the transition bonds, or to assign, sell or
otherwise transfer ITP.

Reserve Subaccount - An account held by the Trustee, under the Indenture, which
consists of remaining funds available after required allocations on the
quarterly payment dates.

SEC - Securities and Exchange Commission.

Servicer - PPL Electric Utilities acting in its capacity under the Servicing
Agreement. In this capacity, PPL Electric Utilities calculates, bills and
collects ITC, and maintains applicable accounting records, among other duties.

Servicing Agreement - The Intangible Property Servicing Agreement between PPL
Electric Utilities, as Servicer, and PPL Transition Bond Company, LLC, as
Issuer.

Trustee - The Bank of New York, a New York banking corporation, as Trustee under
the Indenture.

                                       12
<PAGE>

                                  SIGNATURES
                                  ----------

          Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                  PPL Transition Bond Company, LLC
                                  --------------------------------
                                            (Registrant)



Date: November 3, 2000                     /s/ James S. Pennington
                                      ----------------------------
                                      James S. Pennington, Manager


                                           /s/ Stephen C. May
                                     ------------------------------
                                        Stephen C. May, Treasurer

                                       13